Statement by Counsellor LU Mei on Agenda Item 18: Macroeconomic Policy questions (a-d) and Item 19: Follow-up to and implementation of the outcomes of the InternationalConferences on Financing for Development

2015/10/29

Mr. Chairman,

China associates itself with the statement made by the representative of South Africa on behalf of the Group of 77 and China.

Now that the 2030 Agenda for Sustainable Development has been adopted at the UN Sustainable Development Summit and a new horizon in international development cooperation has unfolded to enable fresh progress on the basis of past achievements, it is vital that the international community attach importance to macroeconomic policy issues, better coordinate macroeconomic policies, pay closer attention to the medium and long-term factors in the world economy and create an enabling policy environment for developing countries. China would like to share its views and observations on the topics under this agenda item, namely, international financial system and development, external debt sustainability and development, international trade and development, and financing for development:

One, international financial system and development

China’s view on this topic is as follows: The reform of the international financial system is to establish a new international financial order that is fair, equitable, inclusive and orderly. The reform is very important to improving the international environment for development; optimizing development partnerships; enhancing the development capacities of all countries; narrowing the North-South divide; and achieving fair, open, all-round and innovation-driven development. This reform should, as a principle, adhere to a comprehensive, balanced, progressive and effective approach, focusing on the following areas: First, to improve the international economic and financial governance system, give emerging markets and developing countries greater representation in international financial institutions and the international monetary system and, as a matter of urgency, implement the 2010 quota and governance reform package for IMF. Second, to improve the global financial regulation system and step up oversight of developed economies that host major financial centres, as well as their macroeconomic policies. Third, to improve the international monetary system, better develop the mechanisms for managing the supply of reserve currency and keep the exchange rates among major reserve currencies relatively stable. Fourth, to strengthen the functions of international financial institutions in development and poverty reduction, with a view to narrowing the gap between the North and the South.

Two, external debt sustainability and development

The Chinese Government pays high attention to the debt sustainability of recipient countries. Whenever a recipient country ran into difficulty servicing mature government debts to China, China would invariably find a proper solution through bilateral channel that would minimize the burden on that country. Since 2000, the Chinese Government has announced seven write-offs of interest-free loans extended to some developing countries that have diplomatic ties with China, with no strings attached. To date, China has signed debt relief protocols with 50 countries in Africa, Asia, the Caribbean and the Pacific region, whereby 395 mature debts have been cancelled, totaling approximately RMB 30 billion yuan (or 4.7 billion dollars). When President Xi Jinping was attending the recent UN Sustainable Development Summit, he announced the exemption of all outstanding intergovernmental interest-free loans due this year from relevant LDCs, LLDCs and SIDS. This was the latest in a series of major debt relief initiatives taken by the Chinese Government. China will fully honor its international debt relief commitments to help developing countries implement the 2030 Agenda for Sustainable Development with tangible action.

Three, trade and commodities

Trade is an integral part of the macro economy. In this regard, China holds the following views: Firstly, we should maintain a free, open and nondiscriminatory multilateral trade system and reject exclusive trade standards, rules and regimes to avoid fragmentation of the global market and trade system. The international community should use the multilateral trade system represented by the WTO as the main enforcer of global trading rules, with regional trade liberalization as its useful supplement. Regional trade arrangements should comply with the WTO rules and contribute to a stronger multilateral trading system. Secondly, developing countries should be helped to integrate into the global value chain, so their capacity for self-development can be strengthened. This can be done more effectively through Aid for Trade, capacity building, promotion of transnational investment, facilitation of trade investment and information technology, all with a view to making developing countries reap greater benefits. Thirdly, it is necessary to lend greater impetus to international trade and look for new growth points. The international community should support developing countries in strengthening their infrastructure development and conduct international cooperation in production capacity to inject fresh vitality into global trade and world economy. Fourthly, international cooperation should be stepped up to bring under control price volatility of commodities in the market. Cooperation should be strengthened to make industries more competitive, improve market governance and operation and lower the dependence on commodities, to enable healthy and steady development of the commodity market.

Four, financing for development

Financing for development is an important dimension of the 2030 Agenda. Implementing the Addis Ababa Action Agenda and scaling up F4D is vital to the comprehensive implementation of the 2030 Agenda.

While international development cooperation has made positive progress since 2000, the development of the Global South and that of the Global North remain woefully unbalanced and developing countries are confronted with many a bottleneck in their development. Adequacy of development resources is an important foundation for international development cooperation. It is also a fundamental safeguard for the development of the developing world. In this globalized world, the international community should intensify F4D and address the concerns of developing countries in the spirit of working together for win-win results. Developed countries should honor their ODA commitments, further their efforts in terms of debt relief and market access and build better linkages between ODA and the actual needs of the developing countries, with more ODA channeled into poverty reduction, health, education and infrastructure.

Mr. Chairman,

China is the largest developing country and an active player in and contributor to global development cooperation. Over the past decades, China has, within its capabilities, provided aid, capital, market, technology and development experience to more than 120 developing countries to support their development endeavors on all fronts. At the recent UN Sustainable Development Summit, President Xi Jinping announced a series of initiatives, including the establishment of a South-South cooperation assistance fund, continued increase in investment in LDCs and programme support for developing countries in economic development and livelihood improvement. The purpose is to help them implement the 2030 Agenda. Currently, China and other stakeholders are working diligently to push ahead with the preparation and operation of new institutions, such as the Asian Infrastructure Investment Bank and the New Development Bank of BRICS. These, combined with other initiatives, such as One Belt, One Road in partnership with catchment countries, are designed to contribute new public goods to global development. China is ready to work with all stakeholders to actively drive international cooperation in F4D, implement the Addis Ababa Action Agenda and the 2030 Agenda for Sustainable Development in an all-round manner and achieve shared growth and prosperity with the rest of the world.